"Clueless, totally clueless." My daughter's description of her friend's knowledge of finance, credit cards, debt, careers, investments--the financial world in general. "Write a book, Dad."
So I wrote a book proposal, got an agent (New York City, no less) and realized that college students and people just starting out don't have any money to buy books AND they get all their information off of the internet. Forget the book. So here is the site for all your money questions and how to get rich.
If you don't see what you need just ASK UNCLE BILL.

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Is there any way you can calm my fears about the current economy? Everything I see is Doomsday everywhere.

I figured I'd let the people at Fidelity do their jobs, but it’s getting worrisome to me. Should I trust them enough to keep my same funds going at this time, and just believe that I'm getting stocks on sale as you put it?

I'm thinking this is getting out of control, I could laugh and groan earlier when it was at -10% to -13%, but now its just climbing higher and higher:

Personal Rate of Return from 01/01/2008 to 09/23/2008 is -18.6%

I know markets go up and down, and I'm obviously in this for the long run, but its getting unsettling for me. And I know the media loves to focus on negative outlooks, but it’s starting to add up. Can you lend your experience to me?

Signed,

Underwater

Dear Underwater,

Well, to be blunt, what do you know that Warren Buffett doesn't? Warren just plunked down $5 billion for a piece of Goldman Sachs and is probably sitting there in Omaha licking his chops and waiting to pull the trigger on a bunch of other buys.

Warren aside, there is danger but it is a danger that the whole thing will grind to a halt. It is not a credit crisis, it is a liquidity crisis because everybody is gun shy (with the exception of Warren) and won't lend anything. Add to that, stupid accounting rules as a result of Enron (Sarbanes/Oxley) and you have quite a mess that will work itself out, as usual, I think.

But in the meantime you are down 18%. So what are you going to do about it? The time to do something is before it happens but we live in the here and now, not yesterday. Sell? That would lock in your 18% loss. But it may go to a 30% loss, or 40% or 50%. Maybe. So what? Painful, you bet, but you have 30 plus years to make it up.

And when do you get back in? Nobody rings a bell to tell us to buy.

Suggest you look at it the way I did when I was in your position--if the market is going up, I would assume that trend would continue. When the market went down dramatically, I had already missed, as you did, the opportunity to sell so I would smash the computer, quit looking at Yahoo Finance, gnash my teeth and go do something else. The damage was done. The market corrects or we all end up in the streets with a lot more to worry about then our portfolios.

That is not to say you are not at risk but your risk is somewhere other than Wall Street. You can’t time or control the market. But you can control you and that we will discuss next week assuming your head is still above water.